View from Seed

APRIL 30, 2015

Below, we talk to Glen Mello , Managing Director of Silicon Valley Bank’s accelerator team in Boston. Glen Mello: Venture debt is a good complement to equity. It’s generally got a lower cost compared to equity capital and can help support growth. Traction and revenue? What are some pros and cons?

Term Sheet 120

Term Sheet Equity Startup Seed Stage 120

Steve Blank

SEPTEMBER 14, 2009

3) invest in and take equity stakes in exchange for capital. Five Quarters of Profitability During the 1980’s and through the mid 1990’s startups going public had to do something that most companies today never heard of – they had to show a track record of increasing revenue and consistent profitability.

Silicon Valley 217

Silicon Valley IPO Technical Review Venture Capital 217

ReadWriteStart

OCTOBER 7, 2010

Bottom line, early stage equity is very, very expensive. As a thumb rule, try to get enough validation so that you can get to at least a $2 million pre-money valuation before raising equity capital. That is debt financing that converts into equity at the Series A valuation once the price for that is set. (I Well, I don't.

Valuation 119

Valuation Silicon Valley Pre-Money Valuation Bootstrapping 119

Both Sides of the Table

JULY 16, 2010

So even within the “alternative class&# our LPs are looking at other asset investment choices such as distressed buyout funds, private equity or hedge funds. The best and most consistent funds in Silicon Valley (e.g. Revenue must come from a primary source (as opposed to advertising or other third party sources).

LP 311

LP Technical Review Early Stage Silicon Valley 311

The Equity Kicker

MAY 9, 2016

The bit I liked the most described the role of Stanford in getting Silicon Valley going in the late 1950s. Silicon Valley started in the small district of Palo Alto and the emergence of Tech City here in East London has been similarly important. We focus on ecommerce and marketplaces.

Silicon Valley 60

Silicon Valley Venture Capital eCommerce Startup 60

Scalable Startup

OCTOBER 26, 2014

Imagine if you’re in Silicon Valley right now with no equity in a tech startup, but associated with several people getting six figure “bonuses” because they somehow wound up with some stock in one. The free parties (or not free) and swag and great stories and boat rides in the bay are nice.

Silicon Valley 25

Silicon Valley Hawaii Angel Investor IPO 25

crowdSPRING Blog

NOVEMBER 30, 2012

In Silicon Valley, Technology Talent Gap Threatens G.O.P. Special Report: Silicon Valley’s dirty secret – age bias | Reuters – [link]. Convertible Debt: really Bridge Loans and Equity Replacement Debt – [link]. Red All Over: Newspaper Revenues Fall In Q3 – [link].

Social Media 100

Social Media Small Business Central African Republic Design 100

Scalable Startup

OCTOBER 26, 2014

Imagine if you’re in Silicon Valley right now with no equity in a tech startup, but associated with several people getting six figure “bonuses” because they somehow wound up with some stock in one. The free parties (or not free) and swag and great stories and boat rides in the bay are nice.

Silicon Valley 20

Silicon Valley Hawaii Angel Investor IPO 20

Both Sides of the Table

MAY 19, 2010

Founded in November 2007 in New York City by Alexis Maybank and Kevin Ryan (co-founder of DoubleClick); CEO is Susan Lyne (ex-CEO Marta Stewart Living Omnimedia) Revenue estimates: $50mm in 2008; $170mm in 2009 (versus budget of $150mm); $450mm forecasted for 2010. Note that these are “gross” revenue numbers.

Partner 240

Partner New York City Cofounder Syndicate 240

Startup Professionals Musings

SEPTEMBER 27, 2013

Many entrepreneurs are convinced that banks are not worth the effort for startups, especially early-stage ones that still don’t have a revenue stream, or collateral to back up their financing needs. All banks are looking hard right now to get back in the game, and certain ones, like Silicon Valley Bank, are more focused on small businesses.

Silicon Valley 187

Silicon Valley Equity Entrepreneur Finance 187

Agile VC

APRIL 17, 2011

How They Make Money: Majority of Kayak’s revenue actually comes from advertising on their site (55%), not lead generation or referral fees to travel suppliers as you might think (more on this below). Financial Snapshot: 2010 Revenue: $170 million. Revenue growth: 51% YoY (2010), 1% YoY (2009), 131% YoY (2008).

Pre-Money Valuation 113

Pre-Money Valuation Liquidation Preference Dividend Common Stock 113

ReadWriteStart

SEPTEMBER 10, 2010

They already have several customers including some telcos, and are at about $350,000 in revenues. Whether it is credit or equity, funding is very, very tight. Because customer financing equals revenue, not equity. Gio expects to get to about $500,000 by the end of this year and asked me for advice on venture funding.

Cloud 115

Cloud Silicon Valley Incubator Finance 115

Austin Startup

NOVEMBER 6, 2017

C-Corp largely because (i) VCs have historically favored C-Corps for nuanced tax and other reasons, and (ii) virtually all of the standardized legal infrastructure around startup finance and equity compensation assumes a C-Corp. However, times are changing. But not all VCs think that way. If you are an LLC tech startup, you need tax counsel.

Delaware 48

Delaware LLC Startup Silicon Valley 48

fi.co

DECEMBER 4, 2012

Globalizing Silicon Valley - See the Worldwide Schedule - Lead a Local Chapter. -->. Our vision is to Globalize Silicon Valley by creating and fostering local startup ecosystems in promising markets across the globe. Let me start by saying I think the only wrong answer in how to split co-founder equity is 50/50.

Cofounder 43

Cofounder Founder Silicon Valley San Diego 43

Startup Professionals Musings

DECEMBER 8, 2017

Don’t believe that Silicon Valley myth that all you have to do is sketch your idea on the back of a napkin, and investors will line up to give you money. Providing your product or service free to customers may sound attractive in marketing materials, but you need revenue sources to survive.

Elevator Pitch 163

Elevator Pitch Angel Investor Silicon Valley Revenue 163

Scalable Startup

AUGUST 9, 2018

If you’ve already soft launched, have a product available, are telling the world about your awesome company but don’t have revenue/user growth, you’re probably in the red zone. Pre-launch funding is pretty common in Silicon Valley, but that’s a unique case. In between those times it’s pretty tough. They’re betting on you.

Technical Cofounder 20

Technical Cofounder Silicon Valley Early Stage Cofounder 20

K9 Ventures

JUNE 12, 2012

Some days in Silicon Valley it feels like there are more investors than there are entrepreneurs. You get a situation whether investors are incentivized to put in more money into a company, not only to buy more equity, but also to fund the quick growth. And there absolutely are more investors than there are good deals.

Venture Capital 117

Venture Capital Silicon Valley Founder Seed Stage 117

Startup Professionals Musings

SEPTEMBER 30, 2010

Many entrepreneurs are convinced that banks are not worth the effort for startups, especially early-stage ones that still don’t have a revenue stream, or collateral to back up their financing needs. All banks are looking hard right now to get back in the game, and certain ones, like Silicon Valley Bank, are more focused on small businesses.

Silicon Valley 201

Silicon Valley Early Stage Startup Equity 201

The Startup Magazine

AUGUST 6, 2021

Although the media has been full of inspiring stories about start-ups in Silicon Valley, the reality is that the rate at which Americans have been starting companies has been in decline for a long time. Without them, you cannot earn any revenue. That changed with the pandemic. This idea extends to the people you work with.

Limited Liability Company 163

Limited Liability Company Silicon Valley Business Model Stock Options 163

K9 Ventures

JUNE 12, 2012

Some days in Silicon Valley it feels like there are more investors than there are entrepreneurs. You get a situation whether investors are incentivized to put in more money into a company, not only to buy more equity, but also to fund the quick growth. And there absolutely are more investors than there are good deals.

Venture Capital 105

Venture Capital Silicon Valley Founder Seed Stage 105

Startup Professionals Musings

JANUARY 12, 2013

See how many you have personally experienced already, or are currently mentioned in your business plan: Crowd-sourcing equity. Sites like KickStarter have for years offered rewards and pre-sales for crowd investments, but real equity won’t be legalized until sometime this year for people other than accredited investors. Gamification.

Entrepreneur 274

Entrepreneur Accredited Investor Silicon Valley Angel Investor 274

ReadWriteStart

JANUARY 27, 2011

And, oh by the way, we also really like the idea of the 1M/1M entrepreneurs building valuation and negotiating leverage through these business development efforts, instead of signing off large chunks of their company in form of equity early on. million in revenue. The business is already profitable with $2.9

Dilution 114

Dilution Revenue Finance Entrepreneur 114

infochachkie.com

SEPTEMBER 24, 2011

Instead of hearing from your long lost third-cousin, you will be inundated with an avalanche of ‘congratulatory’ emails, calls and letters from people who want to relieve you of the burden of your hard-earned equity round. Many such ‘congratulations’ will come from consultants. Performance-based deals are healthy for all parties.

Equity 40

Equity Silicon Valley Cofounder Technical Review 40

Startup Professionals Musings

JULY 16, 2012

A while back I heard a talk by Dave McClure, a long-time angel investor, who also proclaims to be one of the “new breed” of venture capitalists in Silicon Valley, as CEO of 500Startups , which is either a micro-VC seed fund, or a startup incubator, or both. For VCs, early-stage means customer revenue is less than $10M.

Early Stage 253

Early Stage Finance Seed Stage Entrepreneur 253

Startup Lessons Learned

JUNE 22, 2020

The Economic Antidote to COVID-19 Eric Ries & Ryan Beck In 2001, Apple's revenue fell by 33% in the depths of the dotcom bust. As revenue contracts, orders slow, and capital markets freeze, conventional wisdom drives business leaders to cut costs and shy away from new projects. The rest is history. That isn’t a coincidence.

Silicon Valley 60

Silicon Valley Equity Stock Finance 60

Startup Professionals Musings

MAY 1, 2011

Recently I heard a talk by Dave McClure, a long-time angel investor, who also proclaims to be one of the “new breed” of venture capitalists in Silicon Valley, as CEO of 500Startups , which is either a micro-VC seed fund, or a startup incubator, or both. For VCs, early-stage means customer revenue is less than $10M. Super Angels.

Early Stage 231

Early Stage Seed Stage Angel Investor Silicon Valley 231

crowdSPRING Blog

APRIL 5, 2013

Small Business Marketing Tip: Send Email Campaigns At Night To Increase Revenue | crowdSPRING Blog – [link]. SEC Greenlights One Style Of Equity Crowdfunding For Startups | TechCrunch – [link]. Why Silicon Valley needs critics like Morozov | San Francisco Chronicle – [link]. ” – [link].

Social Media 92

Social Media Small Business Design Media 92

Both Sides of the Table

APRIL 25, 2011

There’s a line of thinking in Silicon Valley that you should build product businesses rather than services businesses. The founders could reinvest this in growth (0% tax, focus on future equity growth) or take the profits of $12 million and divide amongst the founding partners. This post originally appeared on TechCrunch.

Silicon Valley 332

Silicon Valley IP Dividend Finance 332

Scalable Startup

AUGUST 10, 2012

You hardly ever see a Silicon Valley startup without one, no matter how early stage. Let go of your ego, let go of some equity. The goal is to build long term sustainable businesses and revenue streams. It’s a key qualifier as a serious player in the startup world. Maybe change your name, change your graphics(!),

Early Stage 22

Early Stage Silicon Valley Equity Revenue 22

Scott Edward Walker

NOVEMBER 2, 2011

Split the equity based on prior contributions and expectations going forward, not necessarily equally (see post here ). Don’t issue stock options unless a proper option plan is in place and a valuation has been done in compliance with Section 409A of the Internal Revenue Code (see post here ). None of this is rocket science.

Accredited Investor 111

Accredited Investor Stock Options Delaware Silicon Valley 111

Gust

JULY 8, 2012

A while back I heard a talk by Dave McClure, a long-time angel investor, who also proclaims to be one of the “new breed” of venture capitalists in Silicon Valley, as CEO of 500Startups , which is either a micro-VC seed fund, or a startup incubator, or both. For VCs, early-stage means customer revenue is less than $10M.

Early Stage 177

Early Stage Finance Seed Stage Entrepreneur 177

ReadWriteStart

APRIL 25, 2012

The company now boasts millions of dollars in revenue, and more than 30 petabytes of managed storage in its data centers. But those were equity purchases. One of the things I love about Silicon Valley," he says, "is that you have plenty of other people who are also nuts and want to join, help or support you.".

Management 149

Management Balance Sheet Silicon Valley Salary 149

Austin Startup

AUGUST 20, 2017

They’re looking to be paid properly in the context of the overall salary structure, including cash, benefits, and equity, and to be paid commensurate with performance. That will keep the Silicon Valley wags buzzing for some time to come. I am very surprised when that cool thing actually meets a customer need or drives revenue.

Technical Review 48

Technical Review Software Review Cap Table Securities and Exchange Commission 48

www.lanceglasser.com

MAY 13, 2012

Customer Equity. Silicon Valley melting pot. The CFO is not responsible for making revenue every quarter, but if there is a big surprise, fire him. Queuing theory and product development. A Model for Return on Engineering Expenses. The Essential Product Investigation Phase Gate. So you want to ship the product early?

CTO 40

CTO CTO Hire Technical Review Architecture 40

ReadWriteStart

MAY 30, 2022

Sometime in your future, an investor will offer you money in return for equity. One in particular from a famous VC in Silicon Valley. Then you need to retain the lion’s share of equity. The more people you grant equity to, the more complex your payday. But your biggest test of that financial insight is yet to come.

Bootstrapping 147

Bootstrapping Startup Equity Silicon Valley 147

Venture Chronicles

MAY 26, 2010

Back in March, Ben Horowitz of Andreessen Horowitz wrote a post called The Case For The Fat Startup, where he outlined some of the reasons why a fledging company might want to consider taking a large amount of funding — a strategy that contrasts with the ‘lean startup’ model that has become common in Silicon Valley.

Lean 40

Lean Early Stage Valuation Startup 40

Up and Running

AUGUST 19, 2014

The famed venture capitalist Peter Thiel once declared that the salary an entrepreneur collects from their startup is about a lot more than dollars and cents—it sets the precedent for the guiding force behind the company, among both internal staffers and equity shareholders. When you are confident you can and have paid everyone else.

Salary 119

Salary Sweat Equity Silicon Valley Sales Cycle 119